Everest Kanto Cylinders : EKC reported excellent set of Q3FY09 results which are above estimates both on the revenues and profitability front.
However we factor in slowdown in economy and sharp decline in CV sales.
On a consolidated basis EKC sold 1.5 lakh cylinders in Q3FY09, which is down 3.2% YoY and down 14.5% on sequential basis. This is primarily due to lower sales of cylinders to the OEM players like TATA motors and Ashok Leyland.
However the average realizations per cylinder have improved by 106.6% YoY and up 33.0% on sequential basis as the company is concentrating more on value added cylinders like jumbo cylinders.
The sale of jumbo cylinders has gone up by 49% on YoY basis to 719 cylinders with average realizations of Rs.7.9 lakh per jumbo cylinder.
FY10 EPS is estimated at Rs.18.0.Long term investors can buy with a price target of Rs.200.
However we factor in slowdown in economy and sharp decline in CV sales.
On a consolidated basis EKC sold 1.5 lakh cylinders in Q3FY09, which is down 3.2% YoY and down 14.5% on sequential basis. This is primarily due to lower sales of cylinders to the OEM players like TATA motors and Ashok Leyland.
However the average realizations per cylinder have improved by 106.6% YoY and up 33.0% on sequential basis as the company is concentrating more on value added cylinders like jumbo cylinders.
The sale of jumbo cylinders has gone up by 49% on YoY basis to 719 cylinders with average realizations of Rs.7.9 lakh per jumbo cylinder.
FY10 EPS is estimated at Rs.18.0.Long term investors can buy with a price target of Rs.200.
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